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PAKISTAN has a high rate of electric transmission and distribution losses and is ranked the top 14th among 131 countries.

Over the past five years, these losses have been around 23 per cent of the energy generated by state-owned power distribution companies (Discos) and, additionally, about 35 per cent of output of the privatised KESC. Comparatively, losses in T&D system in other Asian countries are significantly lower, with Bangladesh at 16.95 and Sri Lanka 14.6 per cent in 2009 with China at 6.7 and Malaysia 3.8 per cent in 2011.

While the world average is 8.8, transmission and distribution (T&D) losses in the range of 6-8 per cent of energy generated are considered normal.

Generally, T&D losses are defined as (i)losses in electricity transmission between sources of supply and points of distribution (ii) losses in distribution to consumers. These consist of technical and non-technical or commercial losses.

Technical losses relate to transmission and transformation inefficiencies and poor planning and design of distribution network.
Variable technical losses are those that occur in transmission lines, cables and copper part of transformation, and vary in amount of electricity transmitted.

The losses that occur in transformer cores do not vary according to electric current and are termed as fixed technical losses.
Technical losses are thus an inevitable consequence of transfer of energy. Non-technical losses relate to metering issues like inaccurate meters, pilferage and illegal electricity connections.

Transmission and distribution losses in the National Transmission and Despatch Company Ltd (NTDC)/Discos system have remained almost static on a year-on-year basis for the last five years or so. The highest loss value of 25.95 per cent of output was recorded in 2003 and lowest 22.42 per cent in 2011.

The formula to calculate losses has been revised time and again contrary to international norms. As a result, the Pakistan Economic Survey 2011-12 claims that the T&D losses were reduced to 19.6 per cent in 2011 and Pakistan Energy Yearbook 2011 records 16.6 per cent; whereas according to the NTDC document the losses are at 20.85 per cent of the net generation instead of actual 22.42 per cent.

The total energy generated in Wapda/Pepco system in 2011 was 92,386 GWh, whereas 87,777 GWh was available for transmission and distribution by Discos. The companies however have only billed for 71,672 GWh, having posted loss of 20,714 GWh or 22.42 per cent of the energy generated/purchased including electricity consumed in auxiliaries of power-station.

Likewise, KESC’s T&D losses in 2011 amounted to 34.74 per cent of energy generated i.e. 15,431 GWh, whereas sale was only of 10,071 GWh. According to State Bank of Pakistan Annual Report 2010-11, these losses contributed Rs8 billion to circular debt on a monthly basis. A major portion of the energy losses were non-technical or in other words, this energy was stolen and not paid for.

The Quetta Electric Supply Company (QESCO) has officially admitted that there are almost 5,000 illegal tube-well connections in its area. The situation with PESCO, TESCO and HESCO, where distribution losses are rather unacceptable, is not any better. It is estimated that one per cent distribution loss translates into Rs6 billion annually. Thus, electricity stolen caused a huge loss to the exchequer of about Rs49 billion last year.

According to present tariff system, the entire cost of non-technical loss is borne by end-consumers located in the areas of respective Discos. Ironically, electricity theft is directly proportional to increase in tariff, which is almost a monthly exercise.

The NEPRA sets the maximum values of T&D losses and has given the electricity company a target of one cut annually, which has not been achieved so far. Over time, the theft has rather increased.

Reducing the T&D losses, or achieving energy efficiency, should be the highest priority energy strategy. A number of policy decisions, technical and administrative measures can be taken by the government to reduce power losses, primarily through additional investments in improving T&D infrastructure and increased operational and management efficiencies—from generation to the end-use.

Improvements in T&D technology include several means, such as enhanced power factor at generation, use of high-tech material in distribution lines, installation of smart grid through automation, laying underground distribution lines, adjusting measurement system and placing modern electric meters.